• May 27, 2008

Although its ongoing sales difficulties worsened, Gap Inc. says its net earnings from continuing operations jumped 40% in the first quarter, to $249 million. First-quarter net sales fell to $3.38 billion, compared with $3.55 billion for the first quarter of last year.

On a comparable-store basis, sales sank 11%, compared with a decrease of 4% in the first quarter of the prior year. "We are pleased with our first-quarter results, as we delivered solid earnings growth in a difficult environment," the company says. While the sales declines were across all divisions, Internet sales sparked, gaining 21% to $236 million.

--Sarah Mahoney